India: Great Expectations

In 1991, under pressure from the IMF, India opened some industrial sectors to private companies and removed several licensing requirements. Private cellphone operators, banks, and airline companies started to appear. Soon, private banks were so customer-friendly that they would send someone to your home to help open an account. If you wanted more than $400 in cash, they delivered it free of cost. If you had a complaint, an employee would come to meet you in person within hours — wearing a tie, even in sweltering heat. Mobile phone companies provided outstanding service and, within years, at an enviable price. They delivered my SIM card to my home. If you wanted a new car, you did not have to worry about going to their showrooms. They came to you. Local airlines served great food and drinks, and were manned by bubbling youths full of passion for success. Foreign companies looking for competitive, English-speaking young people set up their operations in India.

Today, much of this lies in ruins. You have to keep chasing these private banks. Their websites are unfriendly, and they deduct money from your account without first informing you what they are about. An account holder stays away from credit cards, unless he really needs them or must show off; yet he still gets credit cards sent to him with yearly fees charged to his bank account, all without his approval.

The Indian government is a vicious, insensitive, passionless, totally corrupt, utterly stupid, and spineless organization, made up partly of psychopaths and partly of crooks, from top to bottom.

Airlines are marginally fine — with sulky services — as long as your baggage doesn’t go missing or a delay doesn’t make you miss your connecting flight. When my baggage went missing, so did the sleek-looking customer agents, for no one wanted to take responsibility. I recently discovered that the biggest mobile company now has no customer service number where you can talk to a live person. You must visit their office. If you deposit cash after your SIM was slated for disconnection (which of course you would not have been informed about), it will have disappeared into a black hole, from which a refund is virtually impossible unless you waste a horrendous amount of time. If the front-line agent has some figment of humanity (which is quite a rarity), he will tell you not to try getting your money back, for he might see the pain you would suffer trying.

Meanwhile, foreign companies started to realize that the costs of doing business were much higher than they had anticipated. They found that looks were deceptive. The English-speaking employees lacked skills, productivity, work ethic, and curiosity. Call-centers started to move to the Philippines. India stayed at best a back-office hub.

On earlier occasions, when I faced problems with Indian companies, I would report them to consumer forums, or write in to the complaint sections of the media. But I soon realized that despite any compensation I received, I spent so much time fighting the insensitive ears of these private companies that the project was cost-prohibitive. These days, if the money involved isn’t much, I forgive and forget, a sign of greying hair and loss of idealism. If what is involved is substantial, instead of fighting in consumer courts, I look for the most efficient strategy. If the Indian company is a subsidiary of a foreign company, I start by calling their CEO's office. When the Indian arm of a Korean refrigerator company refused to do anything about a problem, by calling their Korean office I got a new refrigerator. When a subsidiary of an American company gave me a faulty air conditioner and did nothing about it, I called their CEO in the US. I told his secretary that I would call twice a day to ensure that I got to speak with the CEO. Then their Indian arm worked so well that even the best anywhere in the world would have been impressed. But I have digressed.

In a mere few years, private companies became more like state-owned companies. In some cases one prefers state-owned companies, where at least a bribe does the job. Why?

In general, the "profitability" of Indian companies, particularly the big ones, is a reflection not so much of wealth-creation but of political backing, of their ability to find loopholes in regulations, and of outright theft, often from the poor section of society.

How things go wrong

The Indian government is a vicious, insensitive, passionless, totally corrupt, utterly stupid, and spineless organization, made up partly of psychopaths and partly of crooks, from top to bottom. Most have very numb or dead brains. They exist in dirty, unhygienic, and terrible environmental conditions, for it is they who do the cleaning. I can recall very few encounters with bureaucrats or politicians in which a bribe was not demanded. Moreover, you must grovel and beg in front of these (figuratively and literally) diseased people. Even then there is no guarantee that they will do the job.

I remember that on many occasions the bribes were not about approving something, but just to release my files so that I could take them myself to the next diseased creature. Only a citizen whose mind has not been destroyed and numbed would not feel humiliated by what he goes through at government offices. Not only is the bureaucrat after money, but he relishes the act of demeaning citizens, in a corrupt attempt to make up for his deep-rooted inferiority complex and self-hatred.

Demeaning others leaves the Indian bureaucrat feeling good about himself, at least for the moment. The irony is that all this makes him seriously sick, physically, mentally, and spiritually. His children go astray and he never understands why. As you discover reading The Lord of the Rings, in a tyranny, there is no single tyrant. Everyone is tyrannized by everyone else; everyone's spirit is subdued by everyone else’s. A bureaucrat must sit with people of his kind, who scheme against one another, forever wallowing in the rotting sewage of envy, hatred, and a strange kind of showmanship. In reality, however, they have nothing to show but impotence, for they never create anything useful or productive. They, their wives and kids, and even name-dropping relatives, show off their status in an exaggerated way, through noise, heavy-handedness, armed goons in costumes, and big cars with sirens.

Not only is the bureaucrat after money, but he relishes the act of demeaning citizens, in a corrupt attempt to make up for his deep-rooted inferiority complex and self-hatred.

A casual observer might believe that all you have to do is get rid of such bureaucrats. All you have to do is to change the party in power and streamline regulations and remove corruption through an empowered constitutional authority that politicians cannot touch.

Why then why did private companies fail to sustain their proper character?

The problem is much deeper than an observer might imagine. It is a problem that cannot be reached by the typical libertarian prescription of reducing the size or composition of government. When the prescription is applied, things don’t not turn out much better; and the improvement certainly does not last.

What most people fail to understand is that the state is little more than the sum total of the collective mind.

In India, even a perfectly created product has a very short half-life. My new gym has grown old within months. The dust piles up; the equipment rusts, rather rapidly. My new car earned a big dent, the day I bought it. Every vehicle gets smeared with dents. I don't know anyone who hasn't had several injuries and close calls with death. Day-to-life faults happen with amazing regularity, a frequency that could never have been imagined or statistically expected. The most resilient equipment burns away if you do not think of using a surge protector, for the electricity company will increase the voltage by misconnecting the wires at the main poles. Normal cars need to be redesigned to ensure that they work because, for example, there is almost universal adulteration of petrol. Refrigerators that are designed to keep working as long as they are plugged in stop cooling when water condenses and freezes in their air-pipes as a result of frequent electricity cuts.

Every time you take anything for repair, even a minor one, you get a patch-up job. You are looked upon with amusement if you ask for a good, clean job. No self-respecting workman would want to have anything to do with you, irrespective of the money you offer. Expediency is the mantra. If ever there is a serious repairman, he needs immense cognition to isolate the problem. The others patch whatever they can get away with patching. When you tinker with a system or an individual piece of equipment, trying to correct the problem, you often create more problems, for your tinkering — however innocent it may be — undoes the other patches. This situation exists not just with equipment but with absolutely everything in life. Most Indians waste a very large part of their day putting out existential fires. My five hours of no electricity today, in what is among the best neighborhoods and those most catered to, are one of my smaller worries, for at least I know what the problem is.

So what is the deeper problem?

Unfortunately, but predictably, the bureaucrat described above is merely a reflection of the larger society. He is the tip of the iceberg. This is always the case, but what most people fail to understand is that the state is little more than the sum total of the collective mind. The visible state — the government — and its tyranny is a symptom of the underlying problem: a society that breeds and sustains the statist poison. Individual Indians will decry corruption, but virtually everyone will pay a bribe to gain an unfair advantage over others or take bribes by rationalizing it away. Even written contracts have no value. It is considered fair game if someone steals your money and gets away with it. Most people will not rent their property, for they fear it will not be returned. Most people, even the guy on the street, have a perfect prescription for how I should live my life and will offer it to me unabashedly. Respect for others as individuals and their properties is a completely alien concept. This, combined with fatalism (a product of a superstitious mind that is immune to the concept of causality), is the reason behind the chaos on the roads and every other area of life. I contend that the Indian road is a visual representation of how the Indian mind works.

You cannot have a small government in a society in which everyone wants to control everyone else's life, where no one can be trusted to do a job properly, where the concept of how to make money is not wealth-creation but manipulation and theft. You cannot avoid building a large and corrupt police force in a society where the individual cannot be trusted. You cannot stop a complicated structure of regulations and government in a society in which individuals cannot think straight, clearly, or rationally.

If someone wants a real, sustainable change he should work in the arena of critical thinking and individualism, not on imposing superficial Western ways.

A tyrannical government is a product of a tyrannical, corrupt, and statist society. Even before the society changes, it is the individual who must change. A free society is unsustainable without free-minded individuals. Those who want real change must work on the root: the individual.

The general totalitarianism, indolence, dishonesty, lack of work ethic, confused thinking, irrationality, superstition, and lack of respect for other people have too much momentum on their side to let private companies stay good. The initial euphoria, mostly of a drunken kind, a catharsis, lasted for no more than a few years. What you culturally see in India is not different from what the West was like perhaps 500 years back. India's problems cannot be dealt with unless the society has gone through the reformation, enlightenment, and scientific revolution that happened in the West.

What differentiates the West from "the Rest"

For vices to be replaced by virtues — the way in which a rational individual perceives them — the concept of reason must take precedence. For those who do not think by means of reason, for those whose culture is not based on it, the vantage point from which vice and virtue are considered is very different. For such people, touching a low-caste person to help him might be a sin, and forcefully occupying the property of a poor person to build a temple might be a virtue.

Lacking appreciation of all this, the US government — assuming it was well-intentioned — spent many years lavishing its resources in attempts to bring democracy, the rule of law, etc., to societies where such constructs have mutated back to what they originally were. Those truly interested in bringing a change must understand that outside the West, the mainstream's way of thinking and conceptualizing the world, its way of imagining and perceiving the world, and its resultant aspirations and motivations are driven by undercurrents that are essentially pre-rational. It is the undercurrents that must be changed. They must, indeed, be replaced by reason and individualism.

The problems of India are extreme, but they aren’t just India's problems.

In my travels around the world, I am reminded of this again and again: there is the Western civilization, which values the individual and the concept of reason; and there is the rest, the area of the world in which most people haven't a clue about what individualism means or, if they have a clue, abhor it, even after hundreds of years of interactions with the West and even after the advent of the internet, easy information, and cheap traveling.

Reason and individualism are a rare fruit, a very expensive one. Without it, democracy, the rule of law, and regulations against excessive state power have limited and mostly unfavorable effects. That is the problem of India today.

And not just India. Most places outside the West are in a mess, living a contradiction, having some material development but lacking the necessary basis in reason and individualism, and hence of ethics. Even the West has increasingly lost these concepts. This might be making the world an extremely unstable place. But, again, I digress.

If someone wants a real, sustainable change he should work in the arena of critical thinking and individualism, not on imposing superficial Western ways, trying merely to reduce regulations or reduce the size of the public sector.

The future of India

With China slowing down, Russia failing to impress, Brazil in stalemate, and the economies of the West in stagnation or decline, the focus of those looking for economic growth has moved to India.

Despite producing some of the largest numbers of so-called scientists, engineers, and so forth in the world, India is an extremely wretched country. Relatively speaking, a huge amount of economic growth has taken place since 1991, when it is believed that India started to open up — from GDP per capita of a few hundred dollars then to $1,625 today. In my view, the date when India started to change economically was a decade earlier. India had started opening telecommunications to impress visitors during the hosting of the Asian Games in 1982. This in turn opened channels for an easy import of information and technology through the telecommunications cable. Things developed from there. But now that the low-hanging fruits of imported technology have been extracted from the tree, India is stagnating again.

The mainstream media disagree, strongly. During the past year, the euphoria of the old days has returned to India. The stock market has recently been the highest ever. Foreign institutional investors are flocking again. They see India as the next China, ignoring the fact that India is one of the rare countries that hasn't had an event to shake off entrenched interests, social habits, and patterns of thinking during the past many centuries.

How Modi can change a country of 1.25 billion is something that no one really wants to think about, for these are times of euphoria.

Deaths of hundreds of thousands every year in avoidable calamities of course haven't triggered any shakeup, and hence cannot be called revolutionary. Also, it pays to remind ourselves that the so-called independence movement in India was a political event. As a rule of thumb, a political event is an active avoidance of introspection. India's certainly wasn't a cultural movement or even a shakeup. In a way, it was the antithesis of a shake up. Before that, entrenched interests had participated in the revolt against what came to be known as the Bengal Renaissance, which the English supported. Democracy allowed the basest of elements to rise to the top, making entrenchment worse and a possibility of a shake up more remote and entangled.

India's newly elected prime minister, Narendra Modi, is behind today's grand hopes. Everyone is looking at him. Alas, Indians are so badly trained (and unable to think straight and clearly from the perspective of reason) that supervising a mere few of them often feels impossible. How Modi can change a country of 1.25 billion is something that no one really wants to think about, for these are times of euphoria. Hence, the cycle starts again.

There are far too many hopes about this deity. Modi's deification is perhaps the most visual symptom of India's problems: the society looking up to someone or something external to bring salvation. Today's youth have far too many material expectations, taught them by the TV, but not enough productivity. This might be a very dangerous cocktail in the making. Even if it isn’t, I see no way for India to experience meaningful change unless it gives up its irrationality and superstition. I see nothing on the horizon that is capable of teaching critical thinking to the youth.

For those who care to imagine, India may be, culturally and intellectually, where China and Russia were in the late 19th century. Then, India was indeed going through its own renaissance — the Bengal Renaissance — until it was nipped in the bud by half-baked, uneducable people (Gandhi, Nehru, etc.) who went to study in England and learned nothing more than what their irrational minds could accept: intellectual rationalizations for socialism. They neither got nor were capable of getting even get an inkling that what had made England great was reason and individualism. A bottom-up renaissance was corrupted into a top-down design to change India, the so-called independence movement.

At some point, India has to pick up the threads where it left them, with the premature end of its renaissance. Would that require it to suffer what China and Russia suffered in the early 20th century? It shouldn't, and I would hate to see that happening, but is there any other possibility that human history shows?

About this AuthorJayant Bhandari is constantly traveling the world to understand it and to look for investment opportunities, particularly in the natural resource sector. He advises institutional investors about his finds. He also runs a yearly seminar in Vancouver entitled "Capitalism & Morality."